Question

What is Globalization? What are its main features? Explain in your own words?

Answer 1

Globalization refers to the phenomenon where the different nations come together and engage in international trade activities. Under the globalization, there is an increased level of mutual cooperation among the nation to resolve conflicting issues and work on a comparative advantage basis so that efficient utilization of scarce resources takes place.

Globalization has following main features:

1. Formation of bilateral, multilateral and free trade zones to facilitate the international trade

2. Standardization of policies, standards and principles that are universally accepted.

3. Removal of tariff and non-tariff barriers to facilitate the international trade

4. Relatively free flow of capital and labor from one market to another market

5. countries treating each other as market for their own goods and services, leading to increase in world GDP

6. More countries becoming the member of world organization such as WTO and following the guidelines prescribed by these organizations.